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Headlines have been pointing out that the Dow Jones Industrial average has hit a “DEATH CROSS”- the descriptive term for when the 50dma crosses below the 200dma. What concerns me more is that the S&P500 is converging toward the same trend.

Note the below chart, the 50dma hasn’t dipped below the 200dma for exactly four years. But it’s within 0.89%. Does that foretell mayhem? No…but it is concerning.

My favorite S&P500 trading indicator is the 100 day moving average. [See related article: Swing Trading in One Chart ] Storm clouds have been forming on that chart for some time. Not only is the index below the 100dma, but so is the 5dma, 10dma, and 50dma…surely a warning of thin ice.

As always, invest with caution.

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